The Central Bank of Malta Act, 1967 : a comparative study

Abstract

Central banks in different countries. have a family resemblance which is· the result of the identity of the economic and Social objectives which they serve. The reason why the Central Bank of Malta is in being are neatly summarised in Section 4(c) of the Act: "to promote the orderly and balanced economic development of Malta and a rising level of employment and income consistent with the maintenance of monetary stability in Malta and the external value of the currency." These four aims are common to most central banks even though, as Aufricht remarks, they are explicitly mentioned only in central bank laws drafted after 1945 when they became the avowed objects of economic policy. To achieve these aims central banks are given certain instruments, by law or by tradition or by both. How and whether they use these instruments is a matter of politics' and economics, and so is the study of whether the instruments are sufficient, or not. The lawyer is concerned with the instruments themselves, their sources, the circumstances in which they can be used and their extent. The existence of different central bank laws offers ample scope for a; comparative study. For, like all laws those establishing a central bank are the result of the political, social and economic environment, as -well as of the legal tradition of the country. In Malta the Central Bank was founded in 1968, one year after the enactment of the Central Bank of' Malta Act, and four years after Independence. As in other countries which attained their constitutional freedom after the Second World War, a central bank was considered to be one of the attributes of statehood.